What is Synthetic Biology?
The pharmaceutical and biotech industries have benefited from innovative technology for creating safer and more effective medicines thanks to scientific research and development advancements. The invention of computers has sped up scientific advancement by making it possible to read and modify the structure of little objects like cells or, more importantly, DNA.
The ability to alter the fundamental components of living things, such as cells and DNA, has sparked the development of synthetic biology, or the production of artificial variations of naturally occurring biological entities. Codexis CDXS, Precigen PGEN, and Verve Therapeutics VERV are a few businesses engaged in developing synthetic biology therapeutic candidates.
Synthetic Biology is the name given to the branch of research that deals with the engineering of organisms, according to the National Human Genome Research Institute. Redesigning a specific organism gives it new capabilities to address industry, agriculture, and medicine issues.
There are synthetic biology examples in a variety of fields. Examples of synthetic biology include:
Redesigning microbes to clean up pollution.
Manipulating rice to make it more nutrient-rich.
Altering bacteria to cure cancer.
These alterations are made by changing the genetic coding of the organism.
People often conflate synthetic biology with genome editing in the biotech industry. In terms of how the adjustments are carried out, synthetic biology may be distinct from genome editing. Genome editing involves making more subtle modifications to an organism's DNA than synthetic biology methods, which include stitching an organism's DNA together and inserting it into the target organism to modify its features.
In 2002, scientists working in synthetic biology created the poliovirus from scratch using DNA-altering techniques, and the first synthetic bacterial genome was finished in 2008. The subject of synthetic biology has advanced significantly over the last ten years, despite worries about the environmental effects of introducing modified organisms into the ecosystem, such as biological weapons and others. As it has the potential to speed up the creation of efficient and secure medicines, the sector will continue to advance.
Synthetic biology is a rapidly growing sector with immense potential.
Some experts think the biotechnology field is now in its "golden age." As a result of scientific advancements, illnesses may now be treated and prevented in new and imaginative ways.
For investors, the biotech industry is also offering attractive potential. Many of the top biotech firms already have successful pharmaceuticals on the market and excellent drug candidate pipelines. The epidemic has also opened a wealth of opportunity for biotechnology firms working on COVID-19 therapies and vaccinationses.
best biotech companies
A few biotech firms to pay particular attention to in 2022 are as follows:
AXS-05, the company's flagship medication candidate, targets depression, agitation associated with Alzheimer's disease, and quitting smoking. The business requested U.S. regulatory clearance for the medicine to treat depression in the early months of 2021. The American Food and Drug Administration (FDA) found two manufacturing flaws in Axsome's regulatory application. Still, the company thinks the problems can be fixed and collaborates with the FDA to find solutions.
Two more late-stage prospects are included in the company's pipeline. The FDA is expected to decide whether to approve the experimental medication AXS-07 for use in the treatment of migraines in 2022. AXS-14 for treating fibromyalgia is expected to be submitted for U.S. regulatory clearance by Axsome in 2023.
With peak annual sales — the largest dollar volume of sales per year expected by experts — estimated at $2.6 billion, AXS-05 as a depression therapy might be a blockbuster medicine if authorized. AXS-07 is expected to reach peak annual sales of more than $500 million in the United States alone. If AXS-14 is authorized, analysts predict that peak sales might range between $500 million and $1 billion. Axsome Therapeutics is a promising biotech company to think about investing in in 2022, given the revenue potential for these three medication candidates.
Exelixis
Four of the medications produced by Exelixis are already available. The drug Cabometyx, licensed to treat thyroid cancer and renal cell carcinoma (RCC) and hepatocellular carcinoma (HC), the most prevalent forms of kidney and liver cancer, respectively, is its greatest winner.
Early in 2021, Exelixis and the biopharmaceutical firm Bristol Myers Squibb (NYSE: BMY) obtained U.S. regulatory clearance for using Cabometyx in combination with Opdivo, an immunotherapy medicine made by Bristol Myers. Additionally, Exelixis is collaborating with the pharmaceutical company Roche (OTC: RHHBY) to assess a combination therapy combining Cabometyx and Tecentriq, a cancer immunotherapy medicine. Both therapy plans aim to treat RCC, which has never been treated before.
Due to its profitability, Exelixis' ability to extend its therapeutic offerings and engage in new license deals allows it to amass a rapidly expanding cash reserve. It acquires the right to continue developing the potential early-stage cancer medication XL102 from the biotech business Aurigene, and it also licenses a panel of monoclonal antibodies from WuXi Biologics. Exelixis also purchased GamaMabs Pharma's anti-Müllerian hormone receptor 2 (AMHR2) antibody projects.
Novavax
Novavax is developing the NVX-CoV2373 COVID-19 vaccine candidate. Its vaccine candidate triggers an immune response against the new coronavirus using a single protein molecule, also referred to as a protein subunit.
NVX-CoV2373 has already obtained authorizations or permits in South Korea, the Philippines, India, Indonesia, and the European Union. The World Health Organization has issued the vaccination an Emergency Use Listing (EUL). The EUL is a crucial need for distribution to nations taking part in the COVAX Facility, which strives to guarantee that low- and middle-income countries have access to COVID-19 vaccinations. In 2022, Novavax intends to achieve further regulatory victories, particularly in the United States.
In 2020, NanoFlu, an experimental flu vaccine, showed promising results in late-stage testing by Novavax. NVX-CoV2373 and NanoFlu are used by the business to create a COVID-19 and flu vaccine. In the first half of 2022, Novavax anticipates publishing the findings of phase 1/2 research of this combination vaccination.
Regenerative Medicine Regeneron
Eylea, a medication for eye diseases that Regeneron produces in partnership with Bayer, is the company's major revenue generator (OTC: BAYRY). Regeneron receives all of Eylea's net sales in the United States, while the business shares the profits made in international markets with Bayer.
Another pharmaceutical and life sciences business, Sanofi (NASDAQ: SNY), and Regeneron have a successful working relationship. The autoimmune disease medications Dupixent and Kevzara, the cancer medications Libtayo and Zaltrap, and the cholesterol medication Praluent are all marketed and sold by the two businesses.
The monoclonal antibody treatment REGEN-COV for COVID-19 has thus far been a great financial success for Regeneron. While its partner Roche distributes the medication outside of the United States, Regeneron distributes it inside the country. The coronavirus omicron version doesn't seem to be as responsive to REGEN-COV. Novel antibody therapeutics developed by Regeneron is targeting the highly contagious virus.
The goal of many of Regeneron's medical development initiatives is to have new uses for already-licensed medicines authorized. Additionally, the business is working on novel medication candidates, most notably the experimental gene-editing treatment NTLA-2001 that Regeneron is creating in collaboration with Intellia Therapeutics (NASDAQ: NTLA).
Vertex Pharmaceuticals
Sales of medications to treat the underlying cause of cystic fibrosis (CF) are almost monopolized by Vertex, which produces several CF medications. Vertex's targeted cystic fibrosis patient population might increase by more than 50% thanks to the company's most recent medication, a combination of the two CF medications Trikafta and Kaftrio. Other prospective CF medications under phase 2 testing are also in the company's pipeline.
Vertex's phase 2 studies focusing on pain and renal illnesses brought on by certain gene mutations aim to go beyond CF therapies. Together with CRISPR Therapeutics (NASDAQ: CRSP), Vertex is also developing an early-stage research program to investigate gene-editing treatments for the uncommon blood disorders beta-thalassemia and sickle cell disease. Additionally, the business has progressed the clinical testing of a possible treatment for type 1 diabetes in select individuals.
Vertex is already profitable, giving it a sizable financial reserve that it may employ to expand the pipeline of medication candidates.
Codexis
Upon receipt of a legally binding purchase order for up to $13.9 million of a patented "high-performance" enzyme from an unnamed multinational pharma, Codexis on June 17 increased its 2021 investor guidance. The estimated income, from $82 to $85 million, is predicted to be between $89 and $93 million. In addition, Codexis raised its forecast for product sales from $36 to $39 million to between $45 and $48 million. In November 2020, Codexis announced a partnership with Casdin Capital for the SynBio Innovation Accelerator, demonstrating their commitment to synthetic biology. The Accelerator intends to provide early-stage funding for synthetic and industrial biotechnology businesses with revolutionary technological platforms or distinctive product development skills. A privately owned startup called Arzeda received Codexis' first Accelerator investment, and Arzeda specializes in computational protein design.
Ginkgo Bioworks
By deciding to go public in May via a $17.5 billion merger with a special purpose acquisition company (SPAC), which is anticipated to provide up to $2.5 billion in gross cash profits, Ginkgo Bioworks gained more financial clout. The pre-money equity value of $15 billion for Ginkgo, founded in 2008 by co-founders who have been working together for about 20 years since meeting at MIT, is implied by the SPAC merger with Soaring Eagle Acquisition Corp. Their objective was to create a platform that would make it simple to program cells for use in a variety of industries, including as food, agriculture, medicine, and industrial chemicals. In June, Ginkgo promised to investigate bio-based manufacturing techniques that can replace petroleum-based goods and use its knowledge in organism engineering for a commercial bio-based product developed by Sumitomo Chemical.
Twist Bioscience
Twist Bioscience joined data storage behemoths Western Digital, Illumina, and Microsoft last year to co-lead the DNA Data Storage Alliance they established with 11 partner tech-based companies and institutions. Twist Bioscience's disruptive platform produces synthetic DNA by "writing" DNA on a silicon chip. By settling on a "roadmap" of definitions and standards to assist the industry in achieving interoperability across technologies, the alliance seeks to develop DNA data storage. Twist acquired iGenomX in June, a company that provides multiplex library preparation tools for next-generation sequencing (NGS) workflows. Twist also collaborated with Regeneron Genetics Center to develop a custom NGS population genetics genotyping assay that considers genetic variations worldwide. This helped to shed light on disease mechanisms, identify new drug targets, and quicken the process of discovering and developing new medications.
President
On June 10, Precigen's wholly-owned subsidiary Precigen ActoBio released positive topline findings from a Phase Ib/IIa trial (NCT03751007) evaluating the effectiveness of AG019, a microbe-based therapeutic created using the company's ActoBioticsTM platform, in treating type 1 diabetes with recent onset. Five out of nine people (56%) who received an eight-week oral AG019 alone exhibited stability or a rise in C-peptide levels throughout the first six months, as did seven out of ten adults (70%) and all four adolescents who received AG019 with teplizumab. Precigen started a first-in-human Phase I study (NCT04724980) for PRGN-2012, the business's first AdenoVerseTM immunotherapy that targets infectious illness, earlier this year. Along with the UltraCAR-T® studies testing PRGN-3005 in ovarian cancer and PRGN-3006 in acute myeloid leukemia, trials for PRGN-2009 in malignancies linked to HPV are currently ongoing.
Amyris
Along with the Infectious Disease Research Institute, Amyris has created a COVID-19 vaccine for Clean Health & Beauty and Flavors & Fragrances (F&F) markets. Amyris granted Nant Africa a license to use the vaccine on July 1 in a deal that "anticipated to produce several million dollars in near-term upfront and milestone payments" for the business and long-term royalties. President and CEO John Melo credited the company's second strategic ingredients transaction, a potentially more than $500 million supply/manufacturing agreement inked in March with DSM Nutritional Products, a subsidiary of Royal DSM, to supply Amyris's product portfolio of F&F ingredients, for the company's Q1 revenue exceeding all of the 2020s. The value of that sale alone increased Amyris' quarterly revenue by $144 million.
Knowing the biotechnology sector
A biotechnology firm creates medicines using live things like bacteria or enzymes. Using living things sets biotechnology firms apart from pharmaceutical firms, which conduct chemical research and development to create new treatments.
Investors should pay careful attention to what stage each drug candidate is at in a biotech business. Later-stage drugs have a higher chance of success, making investing in that firm less risky. Biotech firms use four main stages and three phases while creating new medications:
1. Medication discovery: A biotech business initially pinpoints a drug candidate and the ailments it may be able to combat.
2. Preclinical testing: The business does in vitro (in test tubes) and/or in vivo evaluations of the drug prospects (in living animals such as mice).
3. Clinical trials: The potential medication is examined on people. Clinical trials typically go through three stages:
Phase 1: Small studies are conducted to ascertain the drug candidate's safe dosage and its effects on people.
Phase 2: Larger trials with 100 or more patients are carried out, with a focus on safety, short-term side effects, and figuring out the best dosage for the medication.
Phase 3: Even bigger trials, including hundreds or even thousands of patients, are carried out to show the experimental medication's efficacy and safety in treating the condition.
4. Regulatory approval: Before a biotech business can commercialize a medicine, it must seek regulatory permission. The clinical testing data the biotech business has produced is used to submit a regulatory approval request to the FDA.
Most biotech businesses have many medications under development at once, providing different income streams. The best biotech investments are spread over a wide range of novel medications.
By issuing new shares of stock, which lowers the value of the current shares, many developing biotech businesses often make cash. Some biotechnology firms also get funding from grants from governmental bodies and charitable groups and money earned via agreements with bigger pharmaceutical corporations. The biotech industry often engages in mergers and acquisitions, making it possible for even the most promising biotech businesses to be bought by their more established rivals.
Because it's conceivable for a company's medication candidate to prove useless or even worse during clinical testing, investing in biotech companies might be dangerous. Additionally, even if testing goes well, biotech firms cannot ensure that an FDA approval of medicine will occur.
The least risky biotech businesses have multiple medications in later stages of development as well as ones that are currently commercially accessible. The top biotech firms also create medication candidates with anticipated peak annual sales.
Concentrating on biotech firms with solid financial situations may lower your investment risk. It is considerably more probable for biotech businesses with one or more pharmaceuticals on the market to succeed, and they are less likely to use innovative strategies to raise the huge sums of money necessary to finance drug research and development. Unprofitable biotech firms run the danger of not having enough capital to adequately finance clinical trials and finish regulatory files in time to launch a new medicine.
The greatest biotech firms are well suited for buy-and-hold investors since they may provide excellent profits over an extended period.
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